FENDI is selling like hot cakes at 19 yuan a cup. What is Heytea thinking?

With the launch of the joint beverage of HEYTEA and FENDI, the new tea brand HEYTEA has seen a long-lost sales boom, with countless order sharing posts pouring in. So, what does the 19 yuan per cup of FENDI mean? Is it just a wave of popularity and traffic? Let's take a look at the author's analysis!

"I can't buy it! This store is sold out..."

"Emma, ​​I got it, but there are still more than 300 accounts ahead..."

Not long after I got to work, a group of girlfriends in the office opened the Heytea Go applet and grabbed Heytea. However, today's Heytea is different from the usual ones. It is a joint drink between Heytea and FENDI, an Italian luxury brand under LVMH. The bright yellow and black complement each other and bring out a sense of luxury.

This collaboration uses a total of three yellow fruits - mango, orange and passion fruit - combined with green tea to create the "FENDI Joy Yellow" special blend.

Image source: Heytea WeChat official account

With the launch of the FENDI co-branded beverage, the new tea brand Heytea has seen a surge in orders that has not been seen for a long time. Many stores have taken more than 4 hours to deliver takeout, and some stores have sold out the FENDI co-branded beverage early. On Xiaohongshu and Weibo, countless order posts have flooded in, and even Lei Jun posted on Weibo that he also drank a cup of FENDI co-branded Heytea.

Image source: Lei Jun's Weibo

When everyone is focusing on HEYTEA's sudden popularity on the Internet, perhaps few people would think about what the 19 yuan per cup of FENDI means? Is it just a wave of popularity and traffic? On one hand, it is a luxury brand, and on the other hand, it is an affordable price, which actually reflects HEYTEA's K-shaped development in the future.

1. Different joint names

In the beverage industry, collaboration is nothing new.

According to Mingliang Company, from April last year to the end of the year, Heytea launched co-branded drinks about once every half a month in summer (peak season) and once a month in winter (off-season). Partners include artists (Fujiwara Hiroshi), consumer brands (3CE, Pidan, KUMO KUMO, ZEGL, etc.), film and television cultural IPs (Dream of the Red Chamber, Only Green, Deep Sea, etc.), e-sports IPs (Genshin Impact, King of Glory DYG Team), platform officials (People's Literature Publishing House, WeChat, Zhihu, WPS, etc.), etc.

As an old rival of Heytea, Nayuki Tea also maintains a stable frequency of launching co-branded SKUs, with a total of 16 times in 2022.

However, the old problem after frequent joint ventures reappeared: when all the leading new tea brands were involved in joint ventures, the former "fun" turned into "boring", and consumers' excitement threshold was constantly raised.

This creates a paradox - the continuous launch of co-branded products is to get rid of the homogeneity between brands; but the frequent launch of co-branded products has, to a certain extent, strengthened the homogeneity between brands.

Refusing to be lost in the crowd and creating refreshing co-branded products has become a new challenge for new tea brands.

The joint product of HEYTEA and FENDI is called "Joy Yellow", priced at 19 yuan per cup. If you buy 2 cups of "Joy Yellow" tea, you can choose 1 of 2 to get a coaster or badge, as well as a handbag with the FENDI English logo printed on it.

Currently on the Xianyu App, the price of the combination of HEYTEA FENDI co-branded peripherals - "1 coaster + 1 cup holder + 1 paper bag + 1 empty cup" - has reached more than 200 yuan.

Image source: Xianyu

Although co-branded tea drinks have long been common, this is the first time that they have collaborated with a luxury brand. Consumers' long-buried curiosity was instantly ignited, and Heytea once again took the lead. In order to complete a set of FENDI peripherals, many netizens chose to buy multiple times to collect coasters and badges.

Although previous co-branded products could briefly arouse consumers’ sense of freshness, they could not bring much improvement to the brand in terms of tone. At the same time, the partners’ popularity was far from phenomenal, so they could not arouse much sparks. However, this time, the story took a turn.

First of all, as a first-tier luxury brand, FENDI’s influence far exceeds all previous collaborations.

"I got my first FENDI for only 19 yuan." In the circle of friends, many people successfully posted photos of this bright yellow packaged drink, and the words and pictures showed happiness. Whether it was vanity or curiosity, they held the mentality of "19 yuan is not a loss, and it is not a scam." Most consumers are willing to try to show off their style with a small amount of money.

Secondly, although the FENDI co-branded peripherals cannot be said to maintain their value, they are still worth collecting and using for a large number of consumers.

Sew the FENDI badge on a pure white T-shirt and it becomes a FENDI white T-shirt. "Thanks to Heytea, I saved 5,000 yuan!" Wash the FENDI beverage paper cup and put a bunch of flowers on it, and it will become a corner of the living room. Netizens have posted their own craftsmanship, and the joy of DIY big brands can be seen.

No one can deny that the collaboration between HEYTEA and FENDI has brought the popularity of new tea drinks to a new level.

2. Sinking without admitting defeat

In 2022, there is a popular term called "K-type". The so-called K-type, in simple terms, refers to differentiation. In a K-type society, the rich tend to get richer and the poor get poorer; and in a K-type economy, the fault will lead to the differentiation of many industries, with emerging and hot industries flourishing, while old and declining industries are completely withered.

Heytea’s business philosophy is very similar to the “K-type” development, that is, the high-end route becomes more high-end and the sinking route becomes more sinking.

First, let’s take a look at the downward trend of Heytea’s K-type development.

Since the beginning of 2022, Heytea, as a trendsetter in the industry, has taken the lead in announcing price cuts. Since then, no single item with a unit price higher than 30 yuan has appeared on Heytea's menu. This move is seen by the outside world as Heytea's clarion call to attack the sinking market.

Image source: Heytea WeChat official account

This is not the first time that Heytea has "lowered its own prices".

In March 2020, the first store of Heytea's sub-brand "Heytea" opened in Shenzhen. The full name of Heytea is "Heytea Beverage Factory", with a clear positioning, targeting the sinking market, which is the base of Mixue Bingcheng.

Xixiaocha’s mini program mainly sells tea drinks, including five categories: fresh milk tea, fruit tea, coffee, ice cream and pure tea, with prices ranging from 6 to 16 yuan.

However, this price is still not very competitive in front of Mixue Ice City, where the price of freshly brewed tea drinks is mostly no more than 10 yuan, and the lowest is only 4 yuan. Consumers in the sinking market are often particularly sensitive to prices.

Not only is the price not competitive, but the number of stores is also not as good as that of Heytea. Mixue Ice City, known as the "king of 10,000 beverage stores", currently has an astonishing 23,923 stores, more than 18 times the number of Heytea stores.

Even though it has opened stores in first-tier cities, the overall business strategy of Mixue Ice City has not changed much. The "L-shaped" strategy of continuing to cultivate the sinking market and surrounding the city from the countryside is the current unchanging general policy of Mixue Ice City.

With Mixue Bingcheng's lower unit price and larger-scale "encirclement and suppression", Xixiaocha's survival space is quite limited. In November last year, the last Xixiaocha store in Guangzhou closed, officially announcing that Xixiaocha's first wave of sinking strategy ended in failure in less than two years.

The failure of the trial did not make Heytea give up. Since the price of freshly brewed drinks could not compete with Mixue Bingcheng, it was better to change the idea, so bottled drinks came on the market. In the Heytea flagship store on Taobao, during the discount season, the discounted price of a bottle of Heytea low-sugar lemon tea was less than 3 yuan.

Although pre-made bottled drinks cannot be directly compared with freshly made drinks, Heytea’s goal remains clear.

Consumers in high-tier and low-tier cities can buy related drinks at low prices as long as they recognize the brand value of Heytea. At the same time, although freshly made drinks can better reflect the fresh taste of the ingredients, bottled drinks are more convenient.

my country's county market has nearly 300 prefecture-level cities, more than 2,800 county towns, and a total population of nearly 1 billion. The potential depression that makes people imagine makes almost all major brands unwilling to give up low-tier cities. The road to sinking is not easy, but Heytea continues.

3. Unlimited high-end

After talking about sinking, let’s take a look at the other end of the K-shaped development: the high-end line.

Before the official launch of the FENDI co-branded product, HEYTEA had already changed the logos of its major official social media accounts to a double HEYTEA logo on a yellow and black background, similar to the FENDI monogram.

On the evening of May 16, FENDI and HEYTEA jointly held the "Hand in Hand Art Exhibition" in Beijing, reinterpreting the brand's classic handbags using local Chinese handicrafts. A special HEYTEA tea room area was created at the event site, showing guests in advance the limited edition special blends and four baked products in cooperation with HEYTEA, which were paired with Yi ethnic group Litsea cubeba spices and yellow fruits, and were open to the public from May 19 to June 16.

Image source: Heytea Weibo

It is understood that the spice "Litsea cubeba" is commonly found in the diet of ethnic minorities such as the Yi people, and exudes a mixed aroma of spicy, fresh and lemony. Therefore, the collaboration between HEYTEA and FENDI can also be seen as a collision of Chinese and Western art and food.

Judging from various signs, although launching co-branded products is already a familiar thing for Heytea, this time the operation has undoubtedly been fully prepared and the team is ready.

In other words, just when everyone thought that Heytea was going to lower its profile, this time Heytea made a high-profile announcement: Going high-end, I am the top streamer. I don’t make a choice between high-end and low-priced.

Having said that, if the competition in the low-price market is more about price-performance ratio, then the main factor in the high-end market must be product quality.

In first-tier cities such as Shanghai, the price of a cup of coffee in a boutique coffee shop can reach more than 50 yuan. Price cannot stop consumers from trying, but "price does not match the location" can.

It doesn’t matter if it doesn’t taste good, as long as it looks good? In the long run, such appearance-oriented approach will not work. In the extremely popular purple ocean track, if a tea brand wants to develop high-end lines for a long time, it is undoubtedly a standard that it tastes good and looks good. As for co-branded products, the occasional icing on the cake is a "side dish", while regular products are always the "main course".

Judging from the milk tea brands that have emerged in recent years, Grandma's Handmade promotes that the base of each drink is made on site using ancient methods, returning to nature, and the products will be discarded if they are not sold out within four hours after they are made. Traditional old coconut milk tea, hand-beaten rice mochi, and freshly steamed super thick taro paste are all the store's signature dishes.

Hand-made rice mochi, photo from Grandma's handmade Weibo

In Shanghai's popular milk tea shop "Charlie Town Black Tea Company", the interior decoration is in the British postmodern industrial architectural style, giving people a sense of luxury. In terms of products, there are "three no" milk teas without pigments, preservatives, or non-dairy creamer. The tea base is only black tea, with 5 different black tea bases, and each tea base has only 3 products (pure tea, milk tea, and added tea). The quality of the products is not the quantity. On social platforms, Charlie Town is called "the Hermes of milk tea" by fans.

It can be seen that for Heytea, the difficulty of the high-end line is not the price constraint, but how to establish a strong brand recognition. As for the flagship product, store style, and raw material upgrade, these are still for Heytea to explore on its own.

Everyone says that Heytea has won this time.

However, if you think about it carefully, traffic is time-limited and the stakes are secretly marked.

The collaboration between HEYTEA and FENDI is time-limited. HEYTEA, which is full of enthusiasm, naturally wants to convert the limited-time traffic into long-term traffic.

The catering industry has always been one of the most difficult industries, and the new tea beverage industry is even more so. Heytea is a leader, but it has no capital to rest. While enjoying this victory, K-shaped Heytea must have been planning its next battle. And L-shaped Mixue Bingcheng is also thinking about its counterattack.

Author: Koala is a Deer

Source: WeChat public account "New Retail Business Review (ID: xinlingshou1001)"